Posted By John Rossomando On 10:16 AM 07/23/2011 In Blog - John Rossomando | 8 Comments

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Environmental regulations drain hundreds of billions of dollars from the U.S. economy each year, and it mostly goes unnoticed by the public.

But proposed legislation from Oklahoma Republican Sen. James Inhofe could make the cost of such government interference more transparent.

“Everybody here is focusing on spending and taxes,” Inhofe said, “but what most people don’t realize is the cost of regulation is just as much as the cost of all of the taxes … it’s just less detectable.”

The legislation, known as the CARE Act, would require the U.S. Department of Transportation and Environmental Protection Agency to publicize — in terms of jobs and money — the direct economic costs of the regulations they publish under the Clean Air and Clean Water Acts.

Inhofe’s bill currently has more than 20 Republican senators onboard, and he hopes to attract support from centrist Democrats like Sen. Joe Manchin of West Virginia.

EPA Deputy Administrator Mathy Stanislaus underscored the senator’s point when he testified before a House subcommittee that his agency had not taken jobs into account when it issued regulations this year pertaining to coal ash and other fossil-fuel byproducts.

The CARE Act would require the EPA and the Department of Transportation to consider the impact on employment of all new air pollution regulations.

“The costs of the regulations on greenhouse gases are about $300 to $400 billion a year,” Inhofe said. “The ozone regulation that he [President Obama] is about to announce next week is huge, and we are talking about some $90 billion.”

Inhofe’s bill would also establish a Cumulative Regulatory Assessment Committee comprised of the secretaries of agriculture, commerce, defense, energy, and labor, the chairperson of the Council of Economic Advisers, the EPA administrator, the administrator of the Office of Information and Regulatory Affairs, the president and CEO of the North American Electric Reliability Corporation, and the chief counsel of the Advocacy Office of the Small Business Administration.

This committee would be charged with evaluating the impact of regulations on employment in each segment of the economy, on production and labor demands in the manufacturing and commercial sectors, on the impact of domestic refining regulations on heating oil and petrochemical prices, and on the potential for undermining the U.S. manufacturing industry among others.

“The outrage of the year is that we are not only trying to spend money to regulate things they couldn’t do legislatively, but we are sending money to China so that they can regulate their industries,” Inhofe said. “Here we owe China $1.2 trillion, and here we are talking about sending them money for their climate program.”

Myron Ebell, director of energy and public policy at the Competitive Enterprise Institute, told The Daily Caller that many of these regulations provide questionable cost benefits when public health gains are measured against job losses.

Ebell contends the Clean Air Act has successfully eliminated up to 98 percent of all particulate matter from the air that was responsible for creating smog, but new regulations initiated today have far more questionable justifications.

Inhofe points to the pending ozone regulations as an example of a regulation based in questionable science because no supporting research has been produced since 2008. The law bars an increase in ozone standards in the absence of new scientific research.

“There is in that same science today [evidence] to decrease from the levels that were in place in 2008,” Inhofe said. “I would contend that not only is it immoral, but it is also illegal.”

In the end, he believes the Obama administration’s environmental regulations will only make energy more expensive and discourage employers from hiring additional workers.

Former Kansas GOP Rep. Todd Tiahrt warns that increasing levels of regulation are jeopardizing the free-market system and slowly transforming the economy into a centrally planned and regulated one.

“They are regulating manufacturers and producers as to what they can and cannot do,” Tiahrt said. “The proposed particulate-matter regulations coming out of EPA [is] trying to regulate what comes off of agricultural property, and they have started to regulate agricultural spraying right down to the nozzle.

“Right now we have more government than we can afford, and we are having more and more
regulations.”

The net result, Tiahrt says, is seen in jobs fleeing overseas to find a more favorable tax code and a more favorable regulatory environment. The uncertainty that comes along with heavy regulations, he adds, is “paralyzing the economic recovery.”